All of us had a difficult 2020. Because of the pandemic, tens of thousands of Americans lost their jobs, and more Americans are using credit cards to pay for groceries and household expenses. That means mounting debt for many families. One way to manage your credit card debt is with balance transfers.
The COVID-19 pandemic has changed our spending habits, perhaps forever. With shelter-in-place orders and restaurant closures, fewer people are eating out (although many are ordering in). There is a major shift in to shopping online and having goods delivered. Streaming services are booming as we buy more home entertainment. Even when we do go out, fewer stores are accepting cash because of worries about infection. This is a great time to take a look at your credit and see if you are getting the most out of credit card rewards.
Times of uncertainty tend to create economic chaos. Just look at stock market trends during the COVID-19 pandemic. When there is a global crisis like the novel coronavirus, you need to know how to protect your personal finances, including how to protect your credit. As your personal situation changes, your credit becomes more important, because you may need to use that credit until things return to normal.
Credit is a fact of financial life, and one of the easiest ways to establish credit is with a credit card. If you’ve never had a credit card before, then finding the card with the right features can be a challenge. It seems that everyone is offering some kind of credit card deal, from big banks like Citi and Chase to your university alumni association. If you are applying for your first credit card, then you want to be sure that you find a card with the right credit terms for your needs, such as no fees, a low interest charge, and additional services such as ID theft protection, from a financial institution you can trust.
Credit card payments are an ongoing issue in most households. If you don’t pay the balance each month, those credit cards will start accumulating interest fees, and suddenly you can find yourself with much higher monthly payments than you budgeted for. What’s worse, over time the cost of those interest fees can add up to more than the actual charges. To avoid paying high credit card interest rates, many people make a balance transfer to another card that offers lower or no interest. This can be a good strategy that will save you money in the long run, if you understand the pluses and minuses of a balance transfer.
Credit is a fact of life, and many Americans are overspending because of rising credit card limits. In order to make money, credit card companies want you to spend more than you can pay back each month on the revolving credit they provide. The problem is that too many Americans spend a lot more than they can afford to pay back, which results in having to make higher credit card payments without putting a dent in your overall debt. If you want to pay off a balance on a high-interest credit card, it may be time to consider a balance transfer.
Nothing remains the same, including your credit card. Terms change. Interest rates change. Your financial situation changes. Your life is in forward motion and your financial needs change, so why are you continuing to use the same old credit card?
There are a number of signs that indicate your credit card may be outdated and it’s time for an upgrade. Any of the following nine signs should be enough to make you consider a change:
People love to use credit cards, but when looking for a new credit card, you want to be sure to get the right services and features. You should understand the terms and fees for your credit card so there are no surprises when you open the monthly bill.
What specific questions should you ask before you sign for a new credit card?
Most people have an aversion to accumulating debt and are cautious about using credit cards. However, credit cards are useful financial tools.
If you use your credit card responsibly, it can help you build credit and achieve a higher credit score. Your credit score follows you throughout your life and will be used whenever you need to borrow money or apply for credit, whether you need a car loan, a student loan, or to qualify for a mortgage.